The UK government is launching a £40m (€45m) venture capital fund for green start-up companies to ‘supercharge’ the development of next generation clean, low-carbon technologies.
The Clean Growth Fund will contribute towards the UK’s plans to reach net zero carbon emissions by 2050 and will be accessible to UK-based companies driving green technology across the power, transport, waste, and building energy efficiency sectors.
Potential examples of projects the fund could support include: energy storage and smart grid systems to bolster resilience in the power system; renewable heating and ventilation technologies across homes and commercial buildings; and bio-fuels and bio-energy systems.
Government funding of £20m is being matched by CCLA, one of the UK’s largest charity fund managers, and the fund could reach £100m by Autumn 2021 through private sector inputs.
Wider private sector investment is now being sought for the fund, which will aim to balance its portfolio across clean growth sectors.
Investment parameters for the fund focus on clean growth technologies, hardware, products and services in sectors including power generation, waste, energy networks, buildings management, industries, bioenergy and alternative fuels.
The fund is seeking to make investments at early stage, seed or Series A rounds in “exciting, innovative clean growth start-ups”.
It will invest in businesses with a prototype product or service demonstrating a clear contribution to reducing greenhouse gases together with compelling evidence of market demand.
UK Business Secretary Alok Sharma said: “The need for innovative and ambitious ideas across green industries has never been greater.
“I am pleased that with the help of this fund, promising clean growth start-ups will be able to step up to accelerate the UK’s recovery, while supporting our path to net zero by 2050.
“This pioneering new fund will enable innovative low-carbon solutions to be scaled up at speed, helping to drive a green and resilient economic recovery.”
CCLA chief investment officer James Bevan said: “We decided it was time for CCLA to invest in the very best early stage technologies to support the UK net zero objective.
“In partnership with BEIS, we have developed a solution, the Clean Growth Fund.
“Through the Clean Growth Fund, we now look forward to working with other investors to support these exciting young UK companies aiming to reduce carbon emissions.”
The fund will be managed by Clean Growth Investment Management (CGIM).
CGIM managing partner Beverley Gower-Jones (pictured) said: “The Clean Growth Fund is a significant boost to the country’s low carbon sector and is a clear signal from the UK government that new and innovative technologies will be crucial to deliver net zero and the clean growth agenda.
“We want to hear from the very best clean technology businesses from across the UK.”